Singstar 3 is a 1-8 player competitive singing game for the PS3. Essentially its a karaoke game. The developers wanted to create a proper studio sound for the vocals, in previous versions of the game they wrote their own real-time processing algorithms these worked but were not to professional standard. For the new version of the game the developers decided to use Professional VSTs from sound forge, these VSTs are run nativeley on the PS3 in real time, all the developers had to do was optimize them for the PS3.
Your singing can also be recorded and post processing added later in another part of the game. This is the first time that real studio quality plug ins have been used in realtime in a a game.
oh and does it make a difference ? well a large one so much so that people thought that sony had changed the microphones for singstar 3, in reality they were the same mics they had always used.